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Laundromat Investing: The Truth About the 95% Success Rate w/ Ken Wimberly · Real Estate Investing with RealDealCrew

• 0:00
  The stat that's oft-quoted in the laundry industry is that there's a 95% success
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  rate in the laundromat industry.
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  But when you dig into the details under that stat, what that really is was that was
• 0:13
  quoted from one of the laundromat manufacturers, their financing.
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  So what it meant was that they had only a five percent default rate.
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  So 95% of the businesses succeed or don't default.
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  That doesn't mean that 95% actually make good money.
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  Most people think that laundromats are passive.
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  Set it, forget it, collect the quarters.
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  Ken Wimberly calls that a myth.
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  He's a former top Keller Williams commercial agent who backed into laundry while
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  leasing out a shopping center in Abilene, Texas.
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  He open his first store just in time for COVID, and today his franchise, Laundry
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  Luv, is building the Buc-ee's of laundromats.
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  In this episode, you'll learn why the 95% success stat is misleading, and why one
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  store takes over a million dollars to open, and one system that changed his entire
• 1:03
  company's trajectory. If this helps, hit subscribe.
• 1:07
  Let's get started.
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  Ken Wimberly joins me here today, and you can find what he can help you with at two
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  locations. One is laundryluv.com.
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  That's L-U-V dot com. I'm going to have that as a clickable link in the show notes,
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  as well as kenwimberly.com, where I I would imagine you have a lot of resources
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  there as well. I really appreciate your time here today.
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  We're going to be talking about laundry mats, real estate, and everything under the
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  sun regarding that. So really appreciate your time here today, Ken.
• 1:41
  Jack, thanks for having me. Been looking forward to this.
• 1:43
  So you've been doing this laundry thing for seven years now, long before it became
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  kind of the trend, if you will.
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  I've I've seen sure seen a lot of laundry as as a as a asset class
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  for quite some time, but
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  You would kind of predate that.
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  Like how did you find your way into laundry?
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  Well, yeah, now it's a big TikTok sensation, but seven years ago we stumbled our way
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  into it and really through real estate.
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  My partners and I were buying a 50,000 square foot shopping center, and it had about
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  20,000 feet of vacancy. And that 20,000 feet was broken into about a 13,000, 135 and
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  a 6,500 square foot space, and we were looking for tenants for those two spaces.
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  And I can't remember if it was ICSC or what kind of conference I was at, but it was
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  at a retail conference and just shopping, talking to a lot of different tenants
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  about our space, and came across one who was a laundromat guy and sent him the info
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  and he got back to me and said, Ken, this is one of the best sites I've seen for a
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  laundromat. And that started a conversation digging into what that meant and and why
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  it was a great site. From there into us trying to find a laundromat operator.
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  We're we're real estate guys looking for a laundromat operator.
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  But this was in Abilene, Texas, and we Could not find an operator to to operate.
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  And that kicked off a conversation with me and my partner saying, what if we did
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  this internally and we became the operator?
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  And that was about a one year period of really studying the industry and the market
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  and deciding do we want to do this?
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  Do we want to take on another venture and get into an operating business?
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  And our studies kind of pointed that it was it was a cash flow, recession
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  resistant, great business for the type of real estate that we were buying.
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  And for us, we thought this could be a built-in tenant as we're acquiring real
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  estate. I happen to know the guys that before had done family video, and they own
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  700 and some odd real estate centers across the United States, and they had a
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  built-in tenant in every one. I thought, man, this could be a version of that for
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  us. And that's ultimately what got us into the business.
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  Hmm. Yeah, it's kind of interesting that you add this as kind of a I don't know.
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  I I guess I wouldn't call it an anchor piece, but it it is something that has that
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  at aspect. I I've run into a lot of mixed use operators that are now
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  automatically putting a laundry facility in there in their mixed use business.
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  It just kind of makes sense to own both pieces.
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  Yeah, it's it's great for B and C real estate shopping centers to have that kind of
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  tenant you know, especially our version of launder mat.
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  We're a a larger format. So we put generally four to six thousand square feet.
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  We've gone up as high as 7200 in our laundromat.
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  Actually, one that we're our very first laundromat, we're in 6,500.
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  We're now expanding that. We're gonna be the largest laundromat in Texas at over
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  14,000 feet when we open the the expansion version of it.
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  And we're you know, as a launder mat, we're a 10 year triple net lease that we go in
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  and and typically have we got three or four five year extension.
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  So we're a long term tenant. that generates a weekly draw of people that are coming
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  in every single week. So from a retail perspective, we make a great tenant.
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  Now if we own the real estate ideal, if but in in many cases we'll just lease the
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  real estate and either side, it's it's a good deal for the landlord.
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  That's an interesting aspect. Is this something that you have to kind of educate the
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  landlord a little bit regarding the long term tenancy as well as you being a draw.
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  Most people think of an anchor store like a something that has to draw people, but
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  this makes a lot of sense. Everybody has to wash their clothes.
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  So it it makes sense just like a grocery store, maybe, would be a good anchor type
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  facility. Yeah, it is, and it is an education for a lot of landlords because many
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  landlords think of the traditional Lawner mat that folks think of, which is yeah,
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  smaller, dingy, maybe non operated, non attended store, and we're the opposite of
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  that. We're We seek to be the Buc-ee's of Laundromats.
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  And so if you're kind of from You've been to Texas, been any Buc-ee's, it's it's a
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  different experience when you go into a Buc-ee's as far as a convenience store or
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  gas station. People look around and they're absolutely wild.
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  And that's what we seek to be from the laundromat industry.
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  So we've definitely an educational component for landlords in much like your grocery
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  store, you're right, we have this weekly draw of traffic.
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  We love to co-tenant with grocery stores, plasma stores, discount stores, et cetera,
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  things that are pulling in other weekly draws.
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  And
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  education, once they go to our website, they check us out, they visit one of our
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  stores, they're really eager and happy to get us in the in the in the centers.
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  It's kind of funny that you made that Buc-ee's comparison because I actually had it
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  written down as a comparison myself.
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  Talk about what you're incorporating to make your laundry facility so unique.
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  Yeah. I took a buddy of mine to Buc-ee's this weekend for the first time, and he was
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  absolutely blown away on that. So
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  we're doing the laundromat industry.
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  First and foremost, in every one of our stores, we put a children's play and
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  literacy area in all of our stores.
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  And people would tell me, you know, when they first saw me doing this, like, Ken,
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  you're taking up valuable square footage of your store.
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  You can have more washers, you get more dryers.
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  And we made a decision early on when we were studying the industry that we wanted to
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  be a family friendly location. Cause I would notice going and studying at the
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  laundromats, there would be single moms in often, and I say single, that moms by
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  themselves with children, using with the debt, and and the kids would be bored,
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  running around, playing games, you know, pushing around laundry carts, climbering
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  out of machines, just being being bored kids.
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  I said, Well, like I back then it was kind of before I had really realized that
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  Buc-ee's was a thing. He said, Back then it was I want to be the Chick-fil-A of
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  laundromats. And so when when Chick-fil-A my kids get a Chick-fil-A, they absolutely
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  love it. There's quality in the consistency of product.
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  You're greeted by someone with a friendly greeting and
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  Pleasure all the time when you go into a Chick-fil-A, there's a children's play area
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  where the kids can play and run around and it's comfortable, it's clean, the
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  restrooms are clean. That's what we want it to be.
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  So we have a children's play area, we have literacy component for the kids, we have
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  interactive games, tactile games for the kids to play and interact with.
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  We have children's programming up on the TVs, on our TVs around the store, it's all
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  positive programming. So no daytime TV, no soap operas, no news, no junk like that.
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  So we put on positive programming the TVs.
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  We have a staffed location. So each one of our stores has a full-time general
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  manager. It's got a almost full time, part time manager, and then it's got six to
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  ten part-time employees. So at any given time, we'll have one to four people on
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  staff at our stores. And so in addition to just doing self-service laundry, we also
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  do full service. So we'll do walk, drive, full, people can drop off their laundry to
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  us, we'll wash your drive, deliver it back to them.
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  We do commercial laundry. We do pickup and delivery laundry.
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  And so we've got multiple services that we offer for folks to try to be as full
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  service as possible. We even do we do a load and leave for people.
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  So someone comes in, and again, say we're a co-tenant with a grocery store.
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  Someone comes in, man, I really want to go grocery shopping, but I got to wait 30 or
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  45 minutes for my laundry to be done.
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  And then this stuff, we'll do a load and leave.
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  They can pay us a small fee, and we'll take their laundry, move it from the washer
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  to the dryer, get it in, so they can go take the full hour or whatever and go
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  grocery shopping, go next door, go grab a bite to eat, and then come back into the
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  laundry's ready. So little things like that.
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  Our restrooms are clean, we're branded, comfortable seating.
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  Just we try to make it inviting.
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  And but most importantly, Jack, is like we teach our people to get to know the
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  customers, because oftentimes what people really want is they just want to be seen
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  and heard and understood. And so we're teaching our staff members to really get to
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  know the customers, engage with them, and what they become is is repeat.
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  Repeat customers.
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  Week after week and we've got the data to to prove it these days.
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  It's it's a it's a great thing.
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  You mentioned the TikTok trend of of laundry.
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  This this goes completely the opposite direction of what I've actually seen.
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  Most people are bragging about how it's a set it and forget it.
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  You just go collect the quarters.
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  You're you're kind of running in the opposite direction It's a myth.
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  Okay. This whole set it and forget it.
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  Go talk to anyone that's really in the industry and they're going to tell you that's
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  an absolute myth and it's to get clicks and it's to get people subscribe to their
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  program or whatever they're going to have, but that is an absolute myth to think but
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  you know real estate very well I mean when people talk about real estate as a
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  passive asset class, that too is a great myth.
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  If you're really looking for passive, you're going to invest in someone else's deal
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  that you trust very much that has a team and infrastructure in place, that's
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  passive, but then it's also super illiquid as well, and you have no control over it,
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  but the laundromat business here is anything But passive, even if you have an
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  unattended version of laundromat, where you don't have people there, you've still
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  got to have someone doing maintenance, someone kind of cleaning up, someone opening
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  and closing it, someone collecting the funds, taking it to the bank.
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  So there's there's things that have to be done.
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  And so it is funny, though, how how many people are just preaching the the passive
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  income business. Yeah. So it's really interesting here is that you kind of found
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  your way into this, it sounds almost accidentally or by circumstance.
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  Talk a little bit about the journey and the effort, because this would be a pretty
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  significant lift to go from zero to where you are here today.
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  It's been a huge lift, Jack. And and
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  initially, this was a you know, it's a side hustle with three partners.
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  There's three of us that were running.
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  It was all our part-time business.
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  One was the operating partner of the company, and two of us were more passive, more
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  of an ad advisory capacity. We we met every week and we talk about what was going
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  on. Well, we opened this in October.
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  2019. So we opened just in time for COVID to come to the United States and shut
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  everything down. And
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  we struggled through that. It took longer to make money than we expected.
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  We really questioned our wisdom on what we were doing many, many times.
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  And I had a I had a separate business.
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  I did two or three different businesses at the time and ended up shutting down one
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  of my businesses a couple years later and deciding my partners and I were kind of
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  deciding like, hey, we need to pour time and effort into this business or just kind
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  of decide that this is going to be just a a minor thing on the side.
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  And because my bandwidth had freed up.
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  One of my partners was was stepping out already, and he was really leaning more into
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  his his his real estate development business.
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  And I made the commitment to step in full time into the business.
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  My partner made the commitment to step in as CEO and really focus on the business.
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  He still got a a separate business, but he stepped in as CEO.
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  And it was the time allocation a number of years ago.
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  When we did that, we brought in a key marketing person, we brought in another
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  operations person. We started hiring team.
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  And really it was the team and infrastructure that allowed us to get where we are
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  right now. So we were also we were ahead of our skis, very much so in terms of
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  the amount we're investing into the team, but we were looking at the future and the
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  growth that we could do. We knew if we leaned into it, we we did more.
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  So then we opened up a second and a third store that year of 2022.
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  We opened up a second and a third store.
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  Now we've opened up a fourth. We decided to become a franchise and then really
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  started, we had more people reaching out to us, wanted to get in partnership with
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  us. So we talked to our attorneys, they really advised us on the franchise side
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  versus actually they would told us if it kind of looks like a duck, walks like a
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  duck, quack like a duck, it's a franchise.
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  And so we lean more into the franchising side.
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  Started documenting systems and be very, very intentional about
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  the systems that we're putting together.
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  And it's helped us become better and better operators.
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  Our margins have continued to increase each year.
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  We're kind of top of industry in terms of margins.
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  We're top of industry in terms of revenue.
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  And it's because we've leaned into systems, we've leaned into developing, we've been
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  into marketing, we've leaned into real estate, all of this.
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  But it has been, to your point, a significant lift.
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  It's it's become my full time business.
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  I've stepped away from all my other endeavors into this as a full time business
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  because I see the opportunity for what this can be.
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  Just to remind everybody, we are talking to Ken.
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  You can learn more at laundryluv.com.
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  That's L-U-V dot com. I'm going to have that as a clickable link in the show notes,
• 14:48
  as well as to Ken's website himself, kenwimberly.com.
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  And if you found some value in what we're chatting about so far, do us a favor,
• 14:56
  share this with one of your friends.
• 14:58
  And if you're watching us on YouTube, give us a like and subscribe.
• 15:02
  You just said the magic word on something there, Ken regarding marketing.
• 15:08
  Like most people are gonna hear like marketing for a laundromat.
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  What like what are you doing there that might be different?
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  Yeah, lots. We're marketing in two fronts.
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  We we're we're we're certainly marketing to grow our our partners and our our
• 15:22
  franchise partners on that side, but on the on the internal side of marketing.
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  So we're I mentioned we have multiple lines of revenue.
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  We've got self-service, wash drive fold, commercial, pickup and delivery, and then
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  we have vended services inside.
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  Each one of those different I'll call verticals within side have a different
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  marketing component that goes to it.
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  So we have a marketing team that is absolutely dialed into there.
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  So start with SEO, AEO. So apps at for answer engine optimization, search
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  engine optimization. We are dialing that in in terms of website design, website
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  language and words. We have hundreds of I'll call them orphan pages on our website
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  that target different types of of marketing that the engines pick up.
• 16:08
  We we do pay per click ads, we do Facebook ads, we do Google ads, we do lots of
• 16:13
  different online marketing. Then we do offline, digital, rather on offline.
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  We'll do postcards, door hangers, signage, targeting to direct to people, marketing
• 16:25
  to the direct demographics that we're doing, and it's it's it's strategic.
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  We'll use things that have some type of method for us to know is the marketing
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  working or not. Because you can spend a lot of money and not know is your marketing
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  working. So we're always trying to dial in and know what our cost is for each one of
• 16:44
  the different marketing channels we use and what type of return we're getting on
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  that. So we're blessed to have an incredible team in place.
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  It's that's been and it's an internal team that puts us all together, does it for
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  each one of our stores and each one of our franchise partners, and it it's it's a
• 16:59
  material impact.
• 17:02
  This is just kind of interesting that you're talking about all of these avenues of
• 17:06
  marketing laundromat. I just don't think a lot of people would even The it again, it
• 17:12
  goes back to that set it and forget it mind frame when people get into these
• 17:17
  supposed passive asset class classes, they just think that they they don't need to
• 17:23
  do any of that. But that's probably where you're seeing probably significant returns
• 17:29
  on that investment. Yeah, and and the whole set it and forget.
• 17:34
  I see that all the time. People will get into it and they're there's so many things
• 17:38
  to think through when you get into a a true operating business like this.
• 17:43
  And we didn't even know what to think when we first got into it.
• 17:47
  We didn't know what we didn't know.
• 17:48
  And every month we learn something else, and we'd fall on our face and we'd learn
• 17:52
  something else. And so this is Yeah, now still every month we're learning and doing
• 17:57
  things, improving every store we build, we're making improvements, we're making
• 18:01
  improvements to our designs, to our prototypes, et cetera.
• 18:03
  And marketing is is one of many of those things that we continue to tweak.
• 18:10
  You mentioned that if it walks like a duck, quacks like a duck, it's a probably a
• 18:14
  franchise. Like what point did that occur where you're you and your team and your
• 18:20
  partners went, like, hey, wait a minute, we might be sitting on something here and
• 18:25
  we should consider this. Yeah, it was a few years ago we were having folks approach
• 18:30
  us about wanting to get into business with us and and help us, you know, set them up
• 18:36
  with a lot of math. And so we thought, you know what, we'll go and start doing joint
• 18:41
  ventures with people that we trust, good operators, we'll do joint ventures with
• 18:45
  them. And we're talking to our attorneys about that, and they were asking us, you
• 18:48
  know, what kind of control we wanted over it.
• 18:50
  Well, I want a good amount of control, because like we've got a model here that we
• 18:53
  want implemented correctly. And that's when the attorneys were leaning, they're
• 18:57
  like, Yeah, if you want as much control as you would like, then you
• 19:02
  you're basically becoming a franchise.
• 19:04
  And so I was very concerned about that.
• 19:07
  Just because the expense to get in and the time it would take to get into a
• 19:10
  franchise, but as we we dug into it more.
• 19:12
  I said look, it really is the way to go.
• 19:14
  And we had folks that were inbound coming to us, and our advisors would tell us,
• 19:19
  look, you're you're running some of the the
• 19:23
  really top models of of what we've seen.
• 19:26
  So we leaned into it. So we started that process two and a half, three years ago.
• 19:31
  We have officially about a year and a half ago became a franchise, got through the
• 19:36
  whole process, became an official franchise, got through the legal and the
• 19:39
  restructuring, everything we needed to do, and started started going out to market
• 19:42
  last year, hitting conferences, franchise shows, different things, and meeting
• 19:47
  people and and then honestly starting to layer more and more infrastructure in
• 19:51
  behind. And we've now through that process, man, it's really between the
• 19:58
  the brand book, the prototypes.
• 20:00
  All the design, the things that we've done that we we kind of had, but we were more
• 20:05
  entrepreneurial about it. Now it's truly been laid out and systematized and put into
• 20:11
  the format where we can just easily hand it out to someone else.
• 20:15
  Let's talk a little bit about your ideal candidate for this, then let's say somebody
• 20:21
  want is interested in this, they like what they're hearing.
• 20:25
  Who who is this made for? Like I know you're talking to real estate investors here,
• 20:29
  but who is that ideal operator that should maybe consider your approach?
• 20:36
  Yeah, it's interesting some of the first folks in our pipeline were real estate kind
• 20:40
  of people that like to buy real estate and saw this as a great kind of thing that we
• 20:45
  did as as a tenant for real estate they'd have we've we've talked to a couple of
• 20:49
  real estate shopping center owners that own dozens of of shadow centers that these
• 20:55
  would be a good fit for. So that is one part of the avatar.
• 20:59
  The other, it's interesting that we've been attracting a lot of CFO types that are
• 21:04
  coming out, the analytical detail kind types that like the numbers that start
• 21:10
  digging into all the different aspects of this, because there's a depreciation
• 21:14
  component, there's a there's an operational business component.
• 21:17
  There's a component of service into the communities where we operate.
• 21:21
  So people that well first of all the the talk about the avatar what we're looking
• 21:25
  for, they need to have a certain amount of capital because it it is somewhat
• 21:30
  expensive to open up each laundromat.
• 21:32
  It's we'll call it roughly a little over a million to a little over two million
• 21:36
  dollars to get into a laundromat like we do.
• 21:41
  And so that's expensive. You've got to put generally 30% down you finance the 70,
• 21:46
  70, 30 loan to cost. So we're looking at four to 600,000 out of pocket per
• 21:52
  laundromat that we that we launch.
• 21:54
  So the the person to get into this someone that has some capital either in A 401k
• 22:00
  that they can utilize for capital, or they or they've just got outside investment
• 22:04
  capital that they can use. Maybe they've been in business or industry for 10, 20
• 22:09
  years. They're looking to do something instead of making money for another
• 22:13
  corporation or company. Maybe they got a great salary, but they're looking to do
• 22:16
  something on their own. They want to build long-term wealth.
• 22:18
  They want to build something that they can really scale and pass on to their family
• 22:22
  or children. We also really look to, you know, strong strategic operator military
• 22:28
  veterans. My partner was a West Point Army Ranger.
• 22:31
  I I served in the Navy, and we really want to support our veteran community.
• 22:38
  So there are a number of, in fact, our it looks like our next franchise they come
• 22:42
  down the pike is husband and wife military veterans that are that that have that
• 22:46
  have the capital to come in and do this.
• 22:48
  And so we're there there's there's a number of folks we're looking at, but it's
• 22:52
  entrepreneurial folks that. Want a team, want a system to follow, want playbooks
• 22:58
  that they can come in and implement.
• 23:01
  To be a part of of a community.
• 23:03
  Because we Skylar and I both came out of the my partner, out of the Keller Williams
• 23:09
  ecosystem. He ran their
• 23:12
  commercial division as a wouldn't end up being CEO of their commercial division.
• 23:17
  I was one of their top commercial agents in KW.
• 23:19
  And if you're familiar with KW, they were the number one training organization in
• 23:25
  the in the United States multiple years in a row.
• 23:28
  And so we came out of this training, coaching, consulting environment, and that's
• 23:32
  what we're bringing into our environment as well.
• 23:34
  So we want coachable folks that want to follow a system, they want to grow something
• 23:39
  big and do something great in their communities.
• 23:41
  One of the things that's really striking, and this is something that I've learned
• 23:45
  previously with talking about you know, franchise type brokers, is the concept that
• 23:51
  franchises typically have a better success rate.
• 23:54
  Than just trying to do this on your own.
• 23:57
  Do you have any stats I mean this might be a little early on for you at this point,
• 24:01
  but stats regarding success rates associated with the laundry industry, because I
• 24:07
  would imagine there's a lot of people that fall for the TikTok influencers and they
• 24:12
  jump into these things without knowing what the heck they're doing and and it kind
• 24:16
  of leads to more damage than profit.
• 24:19
  Yeah, the the stat that's oft-quoted in the laundry industry is that there's a
• 24:24
  ninety five percent success rate in the laundromat industry.
• 24:27
  But when you dig into the details under that stat, what that really is was that was
• 24:33
  quoted from one of the laundromat manufacturers, their financing division So what it
• 24:39
  meant was they had a 95% they had only they had only a five percent default rate.
• 24:44
  Okay, so that's fine. So 95% of the businesses succeed or don't default.
• 24:50
  That doesn't mean that 95% actually make good money.
• 24:53
  That are actually profitable, that are actually making it a return that they could
• 24:56
  take home and feed their family with.
• 24:58
  That is not the case. So when you really dig into stats and figures, and I've I've
• 25:02
  done it, I've read the industry surveys year over year and done a deep dive into
• 25:06
  those. I think the average laundromat volume or the medium laundromat volume
• 25:13
  is something like $350,000 a year in revenue.
• 25:17
  Okay, take $350,000 a year, the average laundromat profit is 20 to 35% in the
• 25:24
  industry. The 35%, I can tell you from our stores, that happens when you get to
• 25:28
  higher and higher volumes. Then your profit goes up because you have certain things
• 25:31
  like your rent to fixed expense, your labor caps out at a certain point as your
• 25:35
  volume kind of keeps going out.
• 25:37
  And so your margins go up as your volume goes up.
• 25:40
  But when you're making $350,000, if you're making a 20% margin on that, that's not a
• 25:46
  lot of money to bring home. And then you've got debt beneath the margin line.
• 25:52
  You're you probably negative cash flow or barely breaking even on some of that.
• 25:56
  So I would say just be careful of some of the stats to people when they when they
• 26:00
  look at it as we've dug into this and lived it for a number of years.
• 26:05
  I see the reality of the business is that it's it's a lot more challenging than
• 26:10
  people look at and think. Yeah, you to you talked about the margin and you've been
• 26:15
  seeing an increase in your margins.
• 26:18
  Did that happen when you started to niche down and find your sweet spot regarding
• 26:24
  the level of service and building these out as the Buc-ee's of laundry?
• 26:30
  Like did you find an increase in your pro profitability at that point?
• 26:35
  Well, where the increase in profitability really came jack is when we started
• 26:39
  ratcheting down certain expenses.
• 26:43
  Labor is a big one. And when we were first running this, again, we were remote.
• 26:47
  Our our our partners and I are remote from where the stores.
• 26:51
  We're at our labor was running really high.
• 26:55
  And so we were at we were barely at break even for a while.
• 26:59
  And then when we started truly focused, putting some systems in, we putting
• 27:02
  scheduling software in, systems in on how we run it, how we bonus our managers, how
• 27:06
  we do things to keep our labor in certain margins.
• 27:09
  And then we started looking at other margins from maintenance, from upkeep, from
• 27:13
  lots of little line items on our PL.
• 27:15
  And when we got detailed, started focusing on the PL line items.
• 27:18
  That's what our and then on our process of the marketing, spending more on
• 27:22
  marketing, doing more to bring in business.
• 27:24
  And so as that came in and our business started growing, and then a little bit of it
• 27:28
  is time, because the more people that come in, the more they have a great experience
• 27:33
  with our staff, the more they tell people.
• 27:35
  And then it's it's a little bit of a snowball effect.
• 27:38
  We start getting more and more customers.
• 27:40
  And again, as I mentioned, as the volume goes up, the margins go up because like one
• 27:45
  of the top three expenses we have on our line items are rent.
• 27:48
  And it's almost always going to be the case in this industry.
• 27:50
  But that rent's a fixed cost. I mean, maybe it goes up a little bit year over year,
• 27:54
  but overall it's kind of a fixed cost as a as opposed to utilities, which vary exact
• 27:59
  in proportion to how much business you're doing.
• 28:01
  So the higher those margin, or the higher your volume goes, the higher your margins
• 28:05
  can go because of certain fixed costs.
• 28:08
  Sure. Any time we add the human element, I I suppose that is the like the most
• 28:14
  fluctuation you're gonna see in your variables, right?
• 28:17
  Like the like you mentioned. And I would imagine that varies from state to state and
• 28:24
  and market to market, too. For sure.
• 28:26
  Labor costs are going to vary dramatically.
• 28:28
  The quality of labor, different things, and rent.
• 28:30
  Certainly. Is is a is a big one.
• 28:32
  That's gonna vary dramatically.
• 28:34
  We've ours
• 28:35
  I mean, just in in the four we've got right now, plus the ones that are coming, we
• 28:39
  see a a dramatic range of rent.
• 28:43
  So I mentioned that we really like B and C class.
• 28:46
  Shopping centers and some of those, we can go find single digit rents, which you can
• 28:50
  really make great things happen.
• 28:52
  But you go to some markets, single digits are absolutely not possible.
• 28:56
  And you're gonna get so you've got to really be careful building these things out
• 29:00
  and planning them and looking at what kind of volume you can do so that you can get
• 29:04
  to certain levels of business. And when you're trying to figure this out, there's a
• 29:09
  tendency of wanting to chase multiple rabbits, and you're not successfully
• 29:17
  completing anything. Like you're you're trying to squash too many bugs at once,
• 29:21
  right? I'm sure that there had to have been a process that you had to implement
• 29:25
  eventually to just like, okay, we have to focus what is the priority here.
• 29:31
  Well, I'll tell you that that's a great insight and question.
• 29:36
  One of the wisest things we have done as a team is about two years ago.
• 29:41
  We leaned in to EOS in the EOS framework.
• 29:46
  And for those not familiar with that, that's entrepreneurial organization system.
• 29:49
  The book Traction. It's kind of all about the EOS system.
• 29:53
  And I had read that book in 2018.
• 29:55
  So I was familiar with the concepts of it for many years.
• 29:58
  I'd implemented portions of it in my business, but I'd never lean fully in.
• 30:03
  And so my partner and I, again, when we decide to really, really get serious about
• 30:06
  this business, said, All right, let's start running that on EOS.
• 30:09
  We hired an EOS implementer to come in, and they're not inexpensive to do that, but
• 30:15
  they're worth every penny. And exactly to what you're talking about.
• 30:19
  He would come in, he comes in every quarter.
• 30:22
  We have a quarterly EOS meetings, and we align on what are
• 30:27
  the three to five big rocks for the company.
• 30:30
  If nothing else got done over the quarter, except for these three to five things,
• 30:34
  what are those things? And then each team member ends up with the same three to five
• 30:39
  rocks for the team member on the leadership team.
• 30:42
  And what are those? So by the end of the quarterly meeting, each team member's got
• 30:46
  three to five of their rocks. Those flow up as long as those rocks are done, all of
• 30:51
  the company rocks are going to get done.
• 30:53
  And as long as those rocks get done from the quarter, we're getting better and
• 30:56
  better and better. And that's what we do every quarter.
• 30:59
  And it's it has made a massive difference in the trajectory of our company.
• 31:05
  Yeah, I can't recommend that book enough.
• 31:07
  There's there's there's a there's a series of them, and that's always in my top ten.
• 31:11
  That's it's it's it's a it's a great way to to think ahead to plan for where you
• 31:16
  want to eventually be be as a business owner.
• 31:20
  Let's let's give before we dive into the rapid fire and start closing out this
• 31:24
  episode, I was hoping we could give everybody who's listening a specific clean like
• 31:31
  what they should consider doing first when it comes to if they're considering
• 31:35
  laundry, like looking back at where you you are today versus starting over, like is
• 31:42
  there anything in particular where people should consider starting if they're even
• 31:47
  Remotely interested in lawn. Yeah, I tell you a few things.
• 31:50
  Like the where we started initially was the CLA, which was the Coin Laundry
• 31:56
  Association. They've now rebranded a bit to Connect Learn Advocate, but the CLA is
• 32:01
  the industry association that is a wealth of information.
• 32:06
  They produce a monthly magazine.
• 32:09
  Every month there's value in that magazine, every single time.
• 32:13
  So I really encourage people to go look up the CLA, subscribe to their magazine,
• 32:19
  start getting that, right? That's just great data.
• 32:21
  They produce an annual survey, which where I get some of the information that goes
• 32:24
  out. So that's a really great place to start.
• 32:26
  There's several people, a bunch of people who jumped into it, are doing laundromat
• 32:30
  podcasts now. So you can go listen to different laundromat podcasts to start
• 32:34
  learning about what people are doing.
• 32:36
  And then like talk to some of the industry lenders.
• 32:39
  There's there's one primary lender called Eastern Funding.
• 32:42
  They do they do a bunch, they're a wealth of knowledge.
• 32:44
  They've been highly involved in the industry.
• 32:47
  For decades. and it talks people like us.
• 32:49
  Good. There's other folks doing laundromat franchises than just us.
• 32:52
  And some of them are doing a great job.
• 32:54
  I believe we're doing a great job.
• 32:55
  Feel free to call us. We'll give you I mean more than happy to give people all the
• 32:59
  information they can have. And if for some people we're a great fit for for others
• 33:03
  we're not, but more than happy to talk to people about laundry and give them
• 33:06
  information because there people in this industry are
• 33:11
  abundantly willing to help and serve.
• 33:14
  So I'm super grateful for that.
• 33:15
  And so there's there's lots of resources to utilize and knowledge to be had.
• 33:20
  Just reach out and ask. What lie do real estate investors often tell themselves?
• 33:25
  Man that the next deal is going to be easier because you've done it before.
• 33:30
  I I I think that's one that I have found as a lie I've told myself and each deal I
• 33:35
  do, there's new problems that that surface.
• 33:38
  So I I'm I might tell lie to myself right now and tell me that the 12th deal is
• 33:42
  going to be easier because I've really started to figure out but as of right now
• 33:46
  each successive deal has its own set of problems.
• 33:48
  If you could go back in time and give your younger self one piece of advice, what
• 33:52
  would it be? Bet on yourself earlier.
• 33:56
  I I didn't believe in myself as much as I should have earlier and to bet on myself
• 34:01
  younger. I've got a son who's 22, a daughter who's 23.
• 34:06
  I tell them that kind of thing all the time.
• 34:07
  You know, make your move, invest in yourself really early now.
• 34:11
  And I tell you this, as my younger self, be willing to make a
• 34:18
  sacrifice in your 20s and learn.
• 34:21
  You you don't have to go push for the most money in your 20s.
• 34:24
  Just go learn in your 20s from someone that's really done it and a great mentor, and
• 34:29
  you will set yourself up in the 30s.
• 34:31
  I need you to look back in your past when you were first scaling your business.
• 34:36
  What was the one position you hired for?
• 34:39
  And would you make that same decision again?
• 34:42
  So I will put it. in Laundry Luv.
• 34:45
  In the first position I hired for.
• 34:47
  So this was the one of the smarter things I had done in Originally there was two of
• 34:52
  us looking at that business. And both of us realized that we are, if you look at
• 34:59
  the Traction book, we are visionaries.
• 35:01
  We are starters, big picture people, and we needed an integrator.
• 35:05
  And so I went to the one person that I thought was one of the greatest leaders I'd
• 35:11
  come in contact with, because I'd worked with them at KW and when he was running the
• 35:15
  organization, the commercial organization, I served on his leadership team.
• 35:19
  And I knew that I wanted the integrator that was really going to make a difference.
• 35:24
  And
• 35:25
  through getting into business with Skylar, the two of us had worked in that
• 35:32
  perfect visionary integrator relationship and have now built the infrastructure in
• 35:37
  the team that is doing amazing things.
• 35:39
  So that one hire was the most important thing.
• 35:41
  And it, frankly, it's been the best partnership of my life.
• 35:44
  And finally, what tool or process have you implemented that has had the biggest time
• 35:48
  saving impact to you or your business?
• 35:52
  We're using Granola now for all of our meeting recordings.
• 35:56
  It records all my notes, it summarizes it, it I can use templates, I can do all
• 36:02
  kinds of things. That has saved me so much time from forgetting what the
• 36:06
  conversation was about. I can go ping it, I can integrate it with Claude, which I've
• 36:10
  integrated it with Claude, I can go ping my notes, I can get summaries and synopsis,
• 36:14
  but using that tool of Granola has been incredible.
• 36:19
  So that I'm not chicken scratching notes or handwriting into a database.
• 36:22
  I could just be focused on the in most of my calls or video calls these days, so I
• 36:27
  can really pay attention to who I'm talking to.
• 36:29
  Jack, thank you again for having me and really grateful for your show.